MR. McCLELLAN: All right, good morning, everybody. Let me go through the
President's day, and a couple of updates I want to give to you, and then
I've got our federal coordinator for the hurricane recovery and rebuilding,
Chairman Powell, here with us, and he'll be here to answer any questions
you might have related to our ongoing efforts there.

But first, let me just go through the President's day. The President this
morning spoke with acting Prime Minister Olmert. They had a good
discussion. The President called to express our deep concern for the
health of Prime Minister Sharon. We continue to pray for his recovery.
Prime Minister Sharon and his family and the people of Israel remain in our
thoughts and prayers, and the President expressed that to Prime Minister
Olmert. The President also wished the acting Prime Minister well during
this difficult period.

And following that, the President had his usual briefing. Here when we get
to New Orleans, the first event will be a roundtable that will include five
small business owners and -- it's a roundtable of small business owners and
community leaders. Mayor Nagin will be there, Chairman Powell will be with
us, the Lieutenant Governor will be there, Lieutenant Governor Landrieu.
And then there will be three congressmen that will be participating in that
roundtable.

At the beginning of that, we'll have pool coverage at the top. I expect
the President will make some brief remarks at the beginning, and touch a
little bit on where we are, in terms of the progress that's being made in
the recovery and rebuilding efforts, the challenges that lie ahead, and the
opportunities that lie ahead. This is an opportunity for the President to
remind the citizens in the Gulf Coast that we remain firmly committed to
doing everything we can to help them rebuild their lives and rebuild their
communities. We are going to be there until the job is done. And I think
that's a little bit of the tone of what you'll hear from the President.

And then following that, we will be going to Mississippi, where the
President will be making remarks on our recovery and reconstruction
efforts. I expect there will be about 400 people in attendance there,
including some people from the school, some National Guard people, local
citizens. When we arrive in Mississippi, there at the landing zone, there
will actually be 40 first responders that will be there upon arrival.

In those remarks, I expect he'll go over some of the key areas we've been
focused on, from housing needs to economic recovery and jobs, education,
infrastructure, development of the infrastructure, and things of that
nature.

Then this evening when we get to Florida, he'll be making remarks at a
Republican National Committee reception. And I think you all have a little
bit of information on that. And then we return back to Washington.

I just want to draw your attention to one announcement today. The
Department of Health and Human Services will be announcing that they are
going to be allocating $100 million to state and local preparedness
efforts. This will be for the pandemic influenza response and preparedness
efforts of state and local officials.

Q One hundred million -- m?

MR. McCLELLAN: Yes, $100 million that they'll be allocating specifically
for state and local preparedness efforts when it comes to pandemic
influenza. And they'll be putting out more information on that later
today.

And with that, I'll just turn it over to Chairman Powell, see if he has
anything to add on our ongoing efforts, or he can just answer whatever
questions you might have related to today's events.

CHAIRMAN POWELL: Good morning.

Q The rebuilding plan that was unveiled yesterday that created a lot of
anger in New Orleans, and there seems to be a request for about $17 billion
from the federal government in there. What is your reaction to that?

CHAIRMAN POWELL: The President is committed, and has told me that the plan
to rebuild New Orleans needs to be a local initiative. So I look forward
to understanding more about that plan and visiting with the people that
were involved in that plan to learn more about it. But it will be their
plan. And as I understand the plan, I will try to understand the
strategies necessary to implement that plan. I look forward to sitting
down with them and understanding more about it as time goes by.

Q You don't have any reaction one way or the other? Is that a --

CHAIRMAN POWELL: I don't have any reaction. I will visit more with them.
I'm going to be down there next week, and I will visit more with them.

Q How will you and the President and the federal government in general
weigh in as that plan goes forward?

CHAIRMAN POWELL: We're not going to weigh in. It will be their plan. It
will be their plan. And as they develop the plan, we'll understand that
plan, understand the strategies that will be necessary to implement that
plan. It would be my hope that there would be one vision, one plan as they
sit down, and after a robust debate, after lots of discussion, I want to
encourage them to come up with one plan.

Q I understand that, but as it goes forward, obviously, there will be an
enormous commitment financially from the federal government. So you're not
just going to hand over the money without any say over how it's spent. So
how does that play in as things more forward?

CHAIRMAN POWELL: As that plan is developed, they have the one vision, I
will -- I understand the strategies, which will include the monies
necessary to implement that plan -- take that back to the administration
and to members of Congress with some thoughts. It's important that the
money be spent wisely; it's important that the money be spent very --
effective stewardship of the taxpayer's money, obviously, is very important
also. But meeting the needs of the local people with their plan is
important.

Q Part of the plan is that if there's -- if not enough people move to a
neighborhood within four months to a year, they're going to bulldoze those
houses. Do you have any reaction to that? People are very upset about
that.

CHAIRMAN POWELL: Again, that's their plan, their plan. And as they
develop that plan, I will understand the strategies necessary to do that.
I'm sure there will be continued debate about that, and people will express
their views.

MR. McCLELLAN: I think the Mayor indicated they're still getting public
input, so decisions haven't been finalized.

Q It's not a done deal.

MR. McCLELLAN: We encourage them to reach a consensus, and we're there to
support their efforts as they move forward. Substantial resources have
been allocated by the federal government, more than $85 billion; $29
billion was just allocated by Congress. So we're dedicating significant
resources to help them move forward on what the President has referred to
would be a local -- locally inspired vision.

Q Now Governor Blanco's office is upset because she's in the
Netherlands, and they feel that you picked this day because she's not
there.

MR. McCLELLAN: We reached out to all those officials, and they had another
scheduling commitment. In fact, we've stay in close contact with those
officials, as well. And the Lieutenant Governor will be present.

Q Why the three month gap?

MR. McCLELLAN: Actually, I'm glad you mentioned that, because -- to kind
of give you an idea of some of our involvement in the region over the
course of that time. This is something that the President has remained
focused on. One reason we have Chairman Powell in place is to work closely
with the state and local officials to move forward on the recovery and
rebuilding efforts.

But since September, and this is not including the President and Vice
President or Mrs. Bush or Mrs. Cheney, but there have been 118 visits by
Cabinet secretaries or other top administration officials, like Chairman
Powell here, or our Small Business Administrator, for instance. And many
of those departments and agencies -- or a number of those departments and
agencies have maintained a strong presence in the region throughout that
time period. The President is going to continue visiting the region I
expect throughout his presidency. This is a top priority for the
President. We've been working with Congress to move forward to make sure
that they have the resources at the federal level to do what they need to
rebuild their lives and their communities. And we will continue to help as
they move forward.

Q Can you describe the area of New Orleans where we're going for this
roundtable? What part of the city and how is it --

MR. McCLELLAN: I don't have more on that right now, but we can get you
that when we get there.

Q Is it one of the very distressed areas? Is it in the 9th Ward?

MR. McCLELLAN: We'll get you that when we get there. You'll be there, so
we can get you more information when we get there.

Q We'll know where we are when we get there.

MR. McCLELLAN: I'll get you that information. I didn't bring it with me,
Elisabeth. (Laughter.) That's what I'm telling you.

Anything else for Chairman Powell, or on the recovery and rebuilding
efforts? Thanks for coming back.

Q On the Israel -- Israeli Radio is taking the President's call to
Olmert today as a sign that he is becoming engaged in the --

MR. McCLELLAN: Who is becoming engaged?

Q The President -- in the peace process with the acting --

MR. McCLELLAN: He's been engaged.

Q -- with the acting leader. Meaning --

MR. McCLELLAN: Secretary Rice has been in touch with the acting Prime
Minister --

Q Meaning that this call means that he's sort of recognizing that
perhaps Prime Minister Sharon is not going to come back, and he's --

MR. McCLELLAN: It's no more than what I said at this point. He's the
acting Prime Minister; he's someone that is well known and well respected.
And we have been working with him. Secretary Rice has been in touch with
him. And we have other officials that are in the region now, working with
both Palestinian and Israeli officials. There are some important
priorities on the agenda -- the upcoming Palestinian elections that are
important to moving forward on building a Palestinian state and moving
forward on the peace process. So we remain engaged in those important
priorities, working with the parties. And Secretary Rice put out a
statement yesterday specifically talking about the Palestinian elections.

Q Can I turn to Iran, and ask about Russia, the reports that Russia
would block any referral to the Security Council. Can you talk about that,
and how encouraged --

MR. McCLELLAN: I don't know exactly which reports you're referring to. I
know that there has been deep concern expressed throughout the
international community about the regime's behavior and intentions,
including by Russia. I've seen comments from the Russian Foreign Minister
and other officials; you've certainly seen comments from the Europeans. I
know Secretary Rice has been in close contact with her counterparts. I
think you're going to be hearing more from the Europeans, if they haven't
already on the ground. We expect to hear more from the Europeans today,
and I expect you'll hear more from Secretary Rice later today, as well,
about how we're moving ahead to address this matter.

Q You're saying that you don't see any movement on Russia's part, in
terms of what they're willing to do? Not just what they're saying, but
what they're willing to do?

MR. McCLELLAN: Well, there's been -- as I indicated yesterday, there's
been a lot of intensive diplomacy going on. We've been in close contact
with our European friends and others and Russia -- Russia and others --
about how to move ahead. The steps that the regime in Iran announced are a
serious escalation of the matter. It is one that is causing growing
concern within the international community. And we remain in close contact
with our European friends and others about how to move ahead. But they're
going to -- I think you're going to hear more from some of these leaders
later, and then you'll hear more from Secretary Rice.

Q As you know, the Vice President said that sanctions would be the
number one item on the agenda if it does go to the Security Council.

MR. McCLELLAN: He indicated it was speculative at this point.

Q No, he said it would be the number one item on the agenda. So what
kind of sanctions was he referring to?

MR. McCLELLAN: Well, again, the first step is to address how we move
ahead. And that's what we're in discussion -- we've been in discussions
with the Europeans and others about. And like I said, I think you're going
to hear more from the Europeans. And we've made it very clear that if the
negotiations have run their course, that there really is no other
alternative but to refer the matter to the Security Council, because the
board of the International Atomic Energy Agency already fond the regime to
be in noncompliance. The steps that they are now taking are only a further
violation of what they agreed to in the Paris Agreement and in their
international safeguard obligations. So let's look at the step we're in
right now. We'll be continuing to stay in contact with others in the
international community about it.

Q Does the President believe that the relatively new President of Iran
is somebody who he can negotiate with on these types of issues -- that the
West can negotiate with on these types of issues?

MR. McCLELLAN: You mean the United States? We don't have --

Q I know, but the West can.

MR. McCLELLAN: -- relations with Iran, the regime in Iran. We stand with
the Iranian people in their desire to seek greater freedom. But I think
that the President of the regime, his statements and actions have only
further isolated Iran from the rest of the international community. And
his comments have been condemned by many leaders; rightly so. And his
comments only further underscore the concerns we have about the regime in
Iran. Their behavior is moving in the wrong direction. And this is an
issue we're working with the international community to address.